With petrol and diesel prices having gone up for all-time high and threatening to escalate further, the BJP and the BJD have been trading charges against each other.
While for the Modi Government the failure to contain the prices is certainly an embarrassment, the BJD has got an opportunity to fish in the troubled waters. Since the Petroleum Ministry is in the hand of Dhramendra Pradhan who has been the strongest critic of Chief Minister Naveen Patnaik, the BJD has threatened an agitation across the State, aiming to kill two birds with one stone.
The common man is greatly impacted by the fuel prices hike as it has a cascading effect on the economy and burns a hole in his pocket by leading to an inflationary situation. So, continuous rise of fuel prices surely rubs salt into the wound of the common man. This explains why the BJD seeks to create a big public outcry against the BJP Government at the Centre and also against Petroleum Minister Pradhan.
Being in the eye of a storm, Pradhan has, meanwhile, rubbished the charges of the BJD and tried to target it politically, by proposing that the State Government can reduce its VAT to slash the fuel prices.
Though Pradhan’s proposal is not wrong but the State would have to lose a huge amount in terms of revenue collected as State taxes on each liter of petrol and diesel sold, if it reduces VAT. Consequently, the BJD has been evading it and concentrating on creating propaganda against the Modi Government as ‘anti-people’.
Be that as it may, it is to be admitted that the Central Government and the State Governments across the country have treated auto fuel as a milch cow. The Centre gets huge revenue by way of excise duties on fuel prices, while VATs of different rates are charged by the States.
As of now, the excise duties levied by the Centre in last three years has gone up 105% (petrol) and 300% (diesel). The excise duty per each liter of petrol has gone up from Rs 9.48 in April 1, 2014 to Rs 19. 48 now. The excise duty on diesel too has gone up from Rs 3.56 to Rs 15.33 per litre over the same period. In other words, 44.7% of retail price of petrol and 38.09% retail price of diesel go as Central taxes. In addition to this, the VAT on the two auto fuels varies from State to State.
It is in this context pertinent to consider slashing both the Central and State taxes over fuel, rather than take recourse in political slugfest and agitation. But since both the Centre and States know it well the extent of revenue loss they have to suffer, they are reluctant, said intellectuals here.
Besides, the Modi Government made so much high sounding rhetoric over implementation of a uniform tax structure in the form of GST but why the fuel is excluded from the GST ambit is only best known to it. If petrol and diesel are included in the GST, the taxes can at maximum be 28% and thus their prices can be stabilized to a great extent, they added.
Similarly, it is high time both the Government and common public cut their consumption of fuel, which will reduce out import burden of petrol and diesel. This can be done by avoiding unnecessary use of personal vehicle and using public transport, they opined.